Surprise

Some days ago I gave you a handful of rules for investing. One of them was never exit an asset class.

This is what kamikaze, suicidal DIYers do all the time. They surf. They read pumper and doomer websites. They take extreme advice. Then they load up on gold because the banks are failing. Or trash Canadian assets because we’re screwed. Or shun preferreds and bonds because yields are puny. Or sell off their REITs because the dinglenuts who ran Target flamed out and retail’s now dead.

This is also why people buy stuff that goes up and shed things that decline. The same holds true for bank stocks as it does for houses in Burnaby. Most people are victimized by their emotions, and lately that has run to fear.

Big mistake. Things are great. At least for those with balanced and diversified portfolios as opposed to, say, McMansions in suburban Calgary.

This week proves again why you can never, ever afford not to own a whole bunch of stuff at the same time. Weeks ago as oil shunted lower and stock markets bled, bonds blossomed. Yields fell and prices rose. Investors with 20% of their portfolio in various bonds (government, corporate, high yield) saw their fixed income rise, mitigating any decline on the equity side. (That’s exactly the plan – it’s what ‘balance’ means. An equilibrium between safe stuff and growth assets.)

Lately, this has all changed. Oil has gained back ten bucks in four sessions – about a fifth of its value. Toronto stocks – unloved and abandoned puppies in January – have been on a tear. Despite the poodles at the Bank of Canada, negative growth and lousy job creation, investors owning an exchange-traded fund like XIU (which holds the biggest 60 companies on the Toronto market) are happy. The TSX is ahead 3.5% so far this year (six weeks) and the gain for the last 12 months is 15.1%.

In the US, the dynamo continues. The greenback has come down on eased tensions over Greece, car sales in January were a home run, the federal deficit as a percentage of the economy has plunged, the unemployment rate is half what it was six years ago, consumer confidence is at an 11-year high and 2.95 million jobs were pumped out in the last twelve months. And while the middle class is still suffering mightily from its failed real estate obsession, the economy is powering ahead. The S&P is flat for 2015 and up 19.8% over the last year.

Now, oil could fall again. Likely will. The Bank of Canada dingdongs may drop their interest rate a second time. And there’s no stopping a mess of layoffs or lower house prices in Alberta (Edmonton listings are now up by almost 30%, and sales are fading). Bond yields could drop and prices rise. Bank shares could come under pressure, just as easily as regain the 15% they’ve fallen this year.

Real estate investment trusts – good ones, held inside an ETF like XRE – have blossomed even as failing stores and punted employees grabbed headlines. That fund has added almost 8% in the past month alone, and gifted investors a distribution yield of 4.73%. Compare that to your GIC.

As bond yields have fallen and prices swollen, investors have also been nibbling away at preferred shares – those hybrid beauties sitting between stocks and bonds. Way more stable than common stock, plus they pay you in tax-reduced dividends instead of interest (as bonds do). Buy them in the big, blue chip companies like the banks or insurers and hang on for a great yield. For example, the fund XPF has traded in a narrow range over the past year and kicks out a dividend yield of 4.96%.

Here’s the point: you have no idea where markets or commodities are headed. You have no idea what oil will cost in a year, or what the Fed will do with interest rates. We can surmise, guess, gamble and wish, but is that really the way to invest?

Of course not. Leave the hormonal urges and emotional baggage to the moist virgins who crave debt and stainless. Those who are serious about building liquid net worth (the best kind) are well served by having a portfolio weighted to 40% safe stuff (half a variety of bonds, half preferreds) and 60% growth (about 8% REITs, the rest in equity – a third of it Canadian, the rest US and international, divided between large and smaller cap companies).

As I said above, establish the correct weightings, don’t sweat over trying to time markets (or you’ll be paralyzed), shun individual stocks and mutual funds, never exit an asset class and rebalance this thing at least once a year. Also move stuff around so that more-taxed assets are in a tax shelter, and the tax-efficient part is not. If this is too much trouble to manage, hire a dude to do it. You can write it off.

Anyone have an opinion on ZRE vs XRE.. I went with beemo because of lower fees but XRE seems to be the fave, with titanium backing, these days. Wondering if I should switch it up as Im due for a rebalancing.

“One more thing. As more and more factories close here in Canada, we import more and export less. This is by itself not supportive for CAD. Take this quote from the Globe (“Canada’s fruit, vegetable prices to rise sharply in 2015: report”):”

Of course, but manufacturing has significantly been replaced with an increase in crude oil export capability.

As for how quickly it will take to get above $1.1 USD$, I’m thinking sometime within the next 10 years. Probably coinciding with a lot of de-leveraging in Canada, and a higher inflation/currency weakening environment in the USA. Sort of the opposite set of circumstances which brought the opposite extremity into play. A bubble in an industry for which Canada is significantly over-exposed, but the USA minimally exposed could drive a lot of overshoot. I believe this industry will be the precious metals miners. So no, I’m not looking for a ‘quick’ move to $1.5 or whatever the number was, but rather, something that builds over the next decade, much like the CAD$ didn’t weaken to 63 cents overnight either — 63 cents was the bottom of a culmination of events that unfolded over the prior decade of both domestic factors in Canada, and a US stock market bubble of epic proportions in the technology sector.

stay invested — that’s what separates the investors from the gamblers. you are giving your money to some faceless entity, and give up most controls. you should not pull it out, and particularly not in a panic. otherwise, you are hurting your long term returns.

you should be keeping your portfolio balanced. ie, invest in what is on sale, ie what has fallen.

all this is (much) easier said than done. if you can’t do it, you should find a proper financial adviser to do it for you.

Last week, the geniuses on Wall Street and Bay Street were saying “Oil could go as low as $30”.

One highly-paid expert even said “Oil could stay around $40 for the next decade”.

I was one of the very, very few who contradicted all the experts and geniuses when I said over and over again on this blog: oil will rebound “sooner rather than later”, and “and oil will not stay below $50 for all of 2015″… “Oil will jump higher just as quickly as it fell, as much as 10% per week”.

Well, looks like all the highly paid experts on Wall Street and Bay Street were WRONG and little-old me was RIGHT.

I am now accepting offers as a financial analyst for $250k/year (hookers and cocaine are optional). ;-)

ZRE has $364,000,000 invested while XRE has $1,340,000,000 invested.
BMO cancelled one of the ETFs I was in and I lost money. I’d rather know I lost with everyone else in a huge fund than some small fund cancellation. JMO

“As for how quickly it will take to get above $1.1 USD$, I’m thinking sometime within the next 10 years. Probably coinciding with a lot of de-leveraging in Canada, and a higher inflation/currency weakening environment in the USA”

Surely the bond market doesn’t suggest it. Current spread in the 10 yr bonds between Canada and the US is ~0.4%. According to your theory this suggest about 4% appreciation in the CAD over the next 10 yr.

Another factory closing in Ontario with production shifting to the U.S. Wrigley Canada announced the pending closure of the Toronto Gum factory today. About 400 good paying jobs gone. Wrigley has a 100 year history in Canada, much like G.M. in Oshawa. On the bright side, more prime land for Condo and coffee shop development.
Thanks for all your advice Garth.

The best paragraph in the article: “Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the U.S. is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older. We need that to be 50% and a bare minimum of 10 million new, good jobs to replenish America’s middle class.”

Canada is the greatest country in the world. Prime Minister Stephen Harper will weather the depression like he did in 2009.

God blesses those who respect women. Canada is one of the top ten countries in which women are given rights and respect. This is why Toronto is ranked by The Economist as the best city in the world.

Those who disrespect women will never find love, a good job or a decent life because Canada is a nation which gets rid of bigots unlike the USA.

If a female co-worker wears a revealing top to work, it is none of your business to make harassing remarks towards her. This is why Toronto is the best city in the world- Men respect women, or they end up on the streets.

“December was not a pretty month for Calgary’s real estate market. Resale activity slumped, as did building permits and housing starts. The MLS benchmark home price edged down slightly from November, though it was still up 8.8 per cent year-over-year. One bright spot was average weekly wages, which advanced 0.5 per cent month-over-month and 3.9 per cent year-over-year. Mortgage rates remained low, and will begin to trend downwards in light of the recent interest rate cut by the Bank of Canada.

Although we expect to see a lot of negative growth on a year-over-year basis in the coming months, it is important to keep in mind that Calgary will be coming down from a record-setting year in real estate in 2014. Resale activity hit an all-time high, as did prices, and multi-family home construction. Regardless of the recent plunge in oil prices, the pace of home building, resale activity, and price growth was not going to be sustained in the long run. There is a big difference between a market that is transitioning from a redhot
sellers’ market to a more balanced environment, and a
market that is crashing.

In the aftermath of the 2008/2009 plunge in real estate values, Calgary’s housing market took years to gain traction again. The MLS benchmark home price did not return to its pre-recession peak until January 2014. The reason for this was easily explained by economic fundamentals; prices rose too far too fast relative to incomes in the years preceding the recession, and a frenzied pace of residential construction left Calgary with a supply glut.

In contrast, the recent increases in property values and building activity were relatively tame. More importantly, they were supported by higher wages and record
population growth. Consequently, there is little evidence that Calgary has a real estate bubble, let alone one that is vulnerable to bursting. Sinking consumer confidence will almost certainly lead to a short-term downturn in real estate sales and prices, but a rebound should materialize relatively quickly. Until oil prices recover to more favourable levels for producers, it’s likely that property prices will be more or less flat.”

Been investing for just over a year now. Yes I am a millenial and yes I just Diversified using Ishares and boom! Would ya look at that! Now if I could just convince my family…and friends… And co workers… And neighbours…. And my realestate agent.. Mortgage broker… Etc etc…

ZRE is equally weighted, and XRE is cap weighted. One argument against cap-weighted indexes is that they force you to buy the most expensive assets. Equal weight buys as much of the cheap stuff as the expensive stuff ideally. It all depends if you care about how these ETFs are constructed.

Maybe this was brought up before, but what would your advice be to someone who will be making his first step in investing this way? I’m just starting out from “nothing” to be honest and wondering what amount of money I should save that will make sense in this scenario before getting into investing (fortunately, I’m also without any debt).

”I agree with everything you said except with regards to mutual funds. Believe it or not some mutual funds do manage to consistently beat passive index funds long term net of management fees.

I think for some they are a viable alternative and cannot be dismissed as a group.”
——————————————-

I have to agree with you there Mike, been dealing with same company since the late eighties and have done extremely well. I do most of the allocations myself and have access to an advisor anytime I wish. My MER’s on a 60/40 portfolio average 1.1%. No front or back end loads, no fees to switch between funds and free access to a representative. My net after MER’s the past couple years has been just over 9.5%…..YTD on RSP, TFSA, and Investment Acct., just over 3%. I review once a month and adjust as necessary but generally only a couple times a year. They work for me and I sleep well at night. Not all mutual funds are created equal.

Easier in Alberta to just leverage into a McMansion, get the Truck, hang your nutz on the back, and funnel your cash into payments over 8 years. Simple no brainer and easy, with no worries unless you get rear ended out of the blue and lose your nutz. But don’t worry about that. $$$$$$hit happens.

You do give good advice. Thank you. I do know that Canadian banks held up better than most banks around the world in the melt down of 2008. A well balanced portfolio should generate a consistent income. It is the overall performance that counts. Stay with it, there are ups and downs in the market place. Fear is the emotion that can kill a well balanced portfolio.

I do know that some gold is good to have since it is a hedge against inflation. I ran into a small liquidity crisis last month and sold an ounce of gold. I bought it for $1,400.00 plus spot of $40.00. I sold it for $1,525.00 last month. It hold its value better than if I had that money in the bank.

Having said that, putting all my eggs into one basket would be stupid.

Hi Garth. Not sure how much time you feel like putting into free advice…. I was just blessed with my first little one. I started looking into RESP’s and it doesn’t seem as attractive as I thought it would be. It sounds like we will have to put our after tax money into his RESP, and the Gov’t will match 20% in grants to the maximum contribution amount. Then the little one will have to pay tax on it when he takes it out to pay for post secondary.

Am I correct that this gets taxed twice? Does he only pay tax on the interest paid and/or the Gov’t contribution or all money withdrawn? Can this fund be self managed through online brokering or does it have to be through our financial institution?

It seems like it might be a better idea to set up a TFSA. I haven’t been able to find out if there is an age restriction on it or if we can do it as soon as his SIN is assigned. Any light you can shed on this would be very appreciated. All the literature I’ve found (both at the bank and gov’t websites) seems incomplete…

Best regards.

RESP is your best bet. Odds are that jr won’t have to pay any taxes when in university, and the Feds give you money every year to the tune of 20%. Sweet. No TFSA for the kid until age 18. You can self-direct the plan. At all costs avoid the baby snatcher RESP sales guys. — Garth

CALGARY – Calgary-based Nexen Energy ULC is reviewing its “organizational requirements” after its Chinese parent, CNOOC Ltd., announced deep investment cuts in response to the crash in oil prices.

CNOOC is also considering a US$5-billion writedown associated with the Canadian subsidiary, purchased barely two years ago for $15.1-billion, according to published reports. Sources close to the company confirmed Nexen is planning a major writedown, some of it associated with the long-struggling Long Lake oil sands project.

Chewing gum maker Wrigley Canada said Tuesday that it plans to close its Toronto manufacturing plant in March 2016.

The move will eliminate 383 jobs at the facility, which has been in operation for 52 years.

It comes as the company is re-organizing its supply chain to deal with a sharp decline in sales of chewing gum.

Recent improvements in sales and increased productivity have “not been enough to offset declines in the gum category over recent years,” Wrigley said in a statement, calling the move “a tough decision.”

this is completely off topic Garth, but you did mention this arrogant man a few posts ago – last week as I recall. anyway, baird is gonzo. resigned today. and good riddance to that garbage. wonder which constituency he pissed off the most?

but on the topic of today, full disclosure: my portfolio hardly budged today. my only energy holding is an Enbridge preferred. so don’t listen to me folks. stay balanced as Garth advises.

Japan lost 85% in real-estate and 80% in stocks over the last two decades. Tell that to the average Joe Japanese equity investor or homeowner.

By every valuation measure the Canadian real-estate market is in an extreme bubble, and a highly advanced one at that, at exactly a time when the global economy is flying at stall speed. This is a recipe for disaster, especially for the average over-indebted highly leveraged Canadian homeowner.

These folks should exit now… while they still can.

Granted, there is no calling the top; this insanity could go on for a while longer, but anyone mortgaged up to their eyeballs in this ponzi scheme that has been flashing red for the last 6 years needs to ask themselves an important question: Do you want to risk looking like a fool by selling before the peak, or do you want to risk loosing it all by selling after the peak?

The United States of America is not enjoying an economic resurgence. They are broke. Detroit, plain an simple. Just like up here, they are also accepting the increasingly @#%5ier jobs, the end of overtime, lower pay, reduced benefits, longer hours, the vanishing pension. Next is their social security.

Oilfield environmental services firm Newalta Corp. of Calgary laid off 180 employees on Tuesday, about 15 per cent of its staff, as it completes the sale of its industrial division and contemplates a lengthy slowdown in activity due to low oil and gas prices.

“The current climate complicates things,” said president and chief executive John Barkhouse in an interview.

Yeah, baird isn’t conservative at all. And we don’t need garbage like him in our offices. We do need, however, a conservative there. Especially in the office baird occupied. We need a conservative there. Someone harper can’t provide because harper himself is not conservative. The concept of conservativeness is lost on harper.

A certain well known group associated with real estate has put together a comprehensive analysis of market conditions in order to help its members navigate just about any situation. Luckily for the rest of us, the information has leaked out through the valiant efforts of one of its members who has risked life and limb to disseminate it as a public service gesture:

Condition: Economy doing well
Objective analysis: Buyers are flush with cash across all income and age groups, which means many more want to realise their dream of owning a home
Recommendation: Buy real estate!

Condition: Banks lending more
Objective analysis: Getting a mortgage for that dream home has never been easier
Recommendation: Buy real estate!

Condition: Banks lending less
Objective analysis: You should squeeze through the narrow window of opportunity before it slams shut, possibly for a generation, if not forever
Recommendation: Buy real estate!

Condition: Foreigners buying more
Objective analysis: Increased competition will mean fewer choices down the road, and this is not confined to the job market
Recommendation: Buy real estate!

Condition: Foreigners buying less
Objective analysis: Time to take advantage of others’ shortsightedness, and bet on the future of Canada, while securing your own retirement
Recommendation: Buy real estate!

Condition: Millennials buying less
Objective analysis: Decreased millennial participation means less competition, showing once again that more seasoned buyers can more readily secure their retirement
Recommendation: Buy real estate!

Condition: Canadians more in debt
Objective analysis: Why not roll the debt into a mortgage and have less to worry while simultaneously securing your home and hearth? You deserve freedom from the constant worry!
Recommendation: Buy real estate!

Condition: Canadians less in debt
Objective analysis: Increased cash flow means buyers can afford that much more home, meaning that the runup in prices is only in its first inning.
Recommendation: Buy real estate!

Condition: House in bad location
Objective analysis: The future potential of this neighbourhood isn’t priced into the listing price. Act now to take advantage of it.
Recommendation: Buy real estate!

Condition: Immigration up
Objective analysis: It’s a well known secret that immigrants, in the pursuit of their dreams, will be seeking homes, reducing the housing supply, while simultaneously driving up prices
Recommendation: Buy real estate!

Condition: Immigration down
Objective analysis: Now is virtually the best time to take advantage of the over capacity because of the unexpected immigration cut. The lull will not last.
Recommendation: Buy real estate!

Condition: Market cool
Objective analysis: Prudent and shrewd buyers are taking this once in a lifetime opportunity to call a place home, rather than throw money away on renting, year after year
Recommendation: Buy real estate!

Condition: Construction up
Objective analysis: Increased construction has opened many opportunities for the select few with the foresight to take advantage of it by locking in a brand new home
Recommendation: Buy real estate!

Condition: Construction down
Objective analysis: Increasing population and decreasing construction mean only one thing…. Act now before everyone is clued in.
Recommendation: Buy real estate!

Condition: Loonie down
Objective analysis: The increased purchasing power of foreign buyers is projected to make a tight market much tighter, putting stateside buyers at a disadvantage unless they act now.
Recommendation: Buy real estate!

Condition: Young buyer
Objective analysis: Why settle for a future of sending rent checks into a vacuum year after year?
Recommendation: Buy real estate!

Condition: Old buyer
Objective analysis: A home is the bedrock of a retirement portfolio for your golden years
Recommendation: Buy real estate!

Thanks for the link. Big news. I would comment at length but in a blog a few weeks ago, Garth said the dawgs commenting on this blog were having their IP addresses supplied to North Korea. I suspect that is true of China as well. It is troublesome enough for me to know that our own PM is reading my emails daily. Hi Steve.

“Surely the bond market doesn’t suggest it. Current spread in the 10 yr bonds between Canada and the US is ~0.4%. According to your theory this suggest about 4% appreciation in the CAD over the next 10 yr.

You suggest > 30% appreciation in 10 yrs.
“

Well, what would a bond ordinarily pay in a currency which has suffered 20% depreciation in just the past 6 months? I’d suggest that the failure of the Canadian bond market to sell off indicates that there is a strong expectation for appreciation. Otherwise, why hold would anyone hold/buy CAD$ debt if the CAD$ is going to remain flat, or, in the view of many analysts, actually go down into the low 70s/60s?

Having said that, it wouldn’t exactly be an absurd suggestion to suggest that USD$ bonds are dramatically overpriced. So merely looking to the yield differential might not lead you to a correct conclusion.

Japan lost 85% in real-estate and 80% in stocks over the last two decades. Tell that to the average Joe Japanese equity investor or homeowner.” – Zen

My understanding is that the converse of Garth’s maxim is “never get into an asset class when it is overvalued”. At some point in time in the past, Japanese equities were not overvalued. Those who had an allocation to them prior to their unrivalled run-up have done ok over the past two decades, considering that they received dividends in a continually appreciating currency. Had they followed Garth’s rebalancing strategy, they probably haven’t bought any new Japanese equities since. This makes sense, because someone has to own them. It’s not like everyone in the world can avoid an asset class at the same time.

So it goes for Canadian real estate. Boomers live in and own houses. Good for them. That’s fanatastic. What they shouldn’t do is buy more now that they’ve gone up so much in price. Neither should millenials be funding their retirements by buying their overpriced homes from them.

#49 Devore
IF YOU HAVE NOTHING POSITIVE TO SAY SHUT THE HELL UP!
Stop picking on someone who has come here to learn.
This is not an economic summit where we try to see who is the smartest person in the room.
It is obviously below you to help me so stay out of it.

Oil will go up again, the only question will be when will it decline for good? Canada needs to diversify and get itself out of oil for all our sakes or we will be doomed to failure. Granted this may not happen in our lifetime or we will be too old to care.

#68 Mark on 02.03.15 at 9:20 pm
“A certain well known group associated with real estate has put together a comprehensive analysis of market conditions in order to help its members navigate just about any situation. ….”

I love it! Thanks Jester, for living up to your title. Seriously, that seems to be a pretty accurate playbook of how the RE promoters work in Canada. Shameless indeed.
………..

Dude what’s wrong with shameless. It’s how moneys made. Forget morals. We awoke having the ambilicord cut. It’s all about money to prosper. Our education system gave us idiots to exploit..

Get with the program people. I’m seriously thinking about un masking and going on a road show..

Read Garth’s post. How much more clear could he be about what you should do? Stop worrying about the f’ing NAV price and this market timing crap, and put the damn money into an effing balanced portfolio as freaking described. Geesh :).

Sean ,my dear friend I,m not trying to market time I’m trying to learn about why certain funds have a different Nav price for the same product …ie front load / back load and whether I should just concentrate on the ones with no load and lower Nav .
Also read my advice I gave Devore.

Sigh…this upswing in oil is temporary. Look for a weekly close back at the 48-ish area.

Garth is correct…this is deflation. Look at all the other commodities. Coal is sinking like a rock…copper….iron…timber….the baltic dry index is in elevator mode, headed to P1.

If you think oil is recovering…you are sadly mistaken. This puppy is just getting going. All the smart traders are taking profit every up tick. Up and down, up and down. The big money front runs the trend…making it look like oil is into an upswing…the sheep follow…then the big money takes profits and down goes oil. The sheep sell “for only a tiny loss”. Buying high and selling low…as it ever was, and ever will be.

Oil won’t really begin to recover until the rest of the commodities begin their climb again. It’s all related….production of commodities directly drives the demand for oil.

#70 Revenge – how does one rebalance or rejigger their mortgage on an overpriced condo in a market crash?

The point I was making about Japan in the last two decades is they were hit by a 1-50 year deflationary depression that no one under the age of 65 had ever seen in their lifetime, therefore they never expected or could even imagine it happening. But it did. And that brings us the Canada …

If one is levered up to the max in an asset class that is historically valued at extreme levels, like Canadian real-estate, they are going to get ravaged in an economic down turn, especially one that is structural (vs cyclical) and lasts for a very long time.

Falling oil will create a cascade of problems in Canada.

Producers cut costs, layoffs follow, overextended indebted folks with falling incomes can no longer afford their lifestyle so they stop buying and consumer consumption slows, causing more companies to cut staff, resulting in less consumer spending, creating a vicious cycle of falling demand leading to more job cuts and weakening prices.

Weak consumer demand combined with widespread distress sales and asset liquidations creates a glut of inventory which precipitates a stampede for the exits resulting in prices falling even further faster.

This downward spiral is followed by defaults, foreclosures, bankruptcies, distressed sales … and bargains.

Not a pretty picture for majority of people.

However, if you are sitting on the sidelines in cash living below your means and watching the madness of the crowd, you are in a position pounce when the opportunity strikes.

The vast majority of folks have been partying like rock stars on borrowed money buying stuff they can’t afford with money they don’t have and believing the party will go on for ever. The party keeps rocking so long as the participants have jobs and prices are going up, but when jobs go away and prices start falling the party is over. Followed soon after by a brutal hangover.

When distressed hung over party-goers are forced to liquidate their stocks, homes, cars, etc. at whatever price the market will bear and assets are marked down to reflect the new reality, the guy who EXITED this party early and is sitting in cash will be buying their stuff at .25 cents on the dollar.

excellent lesson he will never forget. Teach him how to fish now while his mind will be wide open. Don’t take over and start throwing him the fish.
…….
That’s what I was thinking.. But he’s a bit like me back in the day. I don’t know.. I’ll think about it..

I know what you’re saying and I totally agree. As a wise man once said (probably Shawn or Ralph Cramdown), we’re engaged in financial warfare. The smart ones who correctly assess the situation and come out on top will be basking in the sun in their 40’s, while the losers will be working as Walmart greeters into their 70’s.

Had to laugh this morning… CBC Radio did this little spot on Calgary real estate. This joker comes on and says he’s all in to buy a house ASAP because there’s tons of product on the market and sellers are highly motivated. My only thought: We haven’t even begun to see the carnage that’s coming our way. A true greater fool in the making.

By the way, Smokey. With all due respect, you’re teaching your son to be a gambler. You may have the skills, but it sounds like Forex is not his thing. If you keep backstopping him you could both get wiped out. Remember (even though you’re an immortal), pride comes before the fall.

– Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School by Andrew Hallam
– The Little Book of Common Sense Investing by John Bogle.
– The Gone Fishin’ Portfolio by Alexander Green

I was introduced to your blog in 2013 and have been reading it since then. Unfortunately I have no experience in investing except for savingas acount and would like to start. I have a sum of CAD150,000 sitting but dont’ know what to do with it.

I was introduced to your blog in 2013 and have been reading it since then. Unfortunately I have no experience in investing except for savingas acount and would like to start. I have a sum of CAD150,000 sitting but dont’ know what to do with it.

Can someone advise please ?
…….

Sounds like those bucks were made with blood sweat and tears.

I’m the wrong guy to talk to. Now if you won a lottery, and have some basket balls hiding in your pants.

#61 pol
Tangerine funds are indeed a good thing; easy to set up, no transaction fees, rebalancing done once a year with a distribution, nice yield. Our host does not like
them because he can not sell them (and no, I have nothing to do with Scotia), a freelancer since 1988.
Cheers

Actually I don’t sell anything. Paying over 1%, non-deductible, for a robo-portfolio with no financial planning or tax advice is plain dumb. — Garth

The latest read on the BULK SHIPPING INDEX shows a historic low level going back to 1986. After six years of record low close to zero rates from the central bankers in Europe; America; Canada; Japan; Australia; etc. all the bins were full up with OIL; SILVER; GOLD; ETC. and after all the industrialized world had their fill of COMMODITIES and there was no more need to store or HORDE these goods….what happened?

What happened is even with pumping easy money for six years you could not get growth so Mr. Poloz believes he can innitiate a different outcome than we already have. After six years of serious drilling for oil and six years of hoarding the oil couldn’t even keep the price up…you have to stop the easy money as the steroids no longer work.

You want growth. Get off the steroids.

Capitalism functions only with RISK. Zero interest rate is no motivation to put your cash to work.

Sach, do you have an RRSP or TFSA yet? If not, you should max out your TFSA. The rest could be put in your RRSP or put into an unregistered account… there’s more complexity to that decision based on when you might need the money and your current marginal tax rate vs. expected rate at retirement.

For what you invest in, Garth has said it above; 60% growth, 40% safe; safe broken down into bonds or preferred, growth split between Canadian, American, and international index. Vanguard ETFs are a good way to cover most of this.

Also would echo the post above:

“You should start by reading a few good books on the subject;

– Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School by Andrew Hallam
– The Little Book of Common Sense Investing by John Bogle.
– The Gone Fishin’ Portfolio by Alexander Green

This is why I don’t worry about the state of my investments today. I’m in it for the long haul anyway. I keep to a diverse portfolio of index funds and ETFs and don’t look at the ups and downs. Meanwhile my dad keeps pushing for me to invest in penny stocks and silver. Sigh.

Surely the bond market doesn’t suggest it. Current spread in the 10 yr bonds between Canada and the US is ~0.4%. According to your theory this suggest about 4% appreciation in the CAD over the next 10 yr.

This is how the game works: if you’re horribly wrong, just push the prediction out 10 years. Nobody will remember and there’s a better chance that you might be right. This is just Mark’s way to retreat from his completely wrong prediction about the USD and CAD.

Cha Ching is that you???!!!! You are like a dog on a bone! Your posts are still a tad too rabid. Once again, these tactics won’t work here. All respectful opinions accepted here. Scroll past if you are having a problem.

Whether this is a legit snap-back or not, at some point there will be one, and if you sold when you heard some idiot on TV calling $20 a barrel, then you were probably too dumb and/or emotionally unstable to hold volatile commodities in your portfolio in the first place.

#28 L. Thomas on 02.03.15 at 7:32 pm — “Men respect women, or they end up on the streets.”

It’s a pity you weren’t around in the mid-80s to spout your crap. A great (friend) gal I knew either jumped in front of the subway or fried herself on the third rail, because she had had enough of the broken bones she was receiving from her so-called loving husband. They were together for less than five years.

He gets off scot-free for treating her like dirt. Suicide Is Painless, except for those who are left behind.

#45 Cloudy on 02.03.15 at 8:31 pm
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Congrats on becoming a parent, a very exciting (and expensive) time indeed!

Questrade is a good on-line broker for setting up an RESP. Invest in several different ETFs (according to Garth’s formula) and you’ll do fine.

One word of reflection, saving for the future is great, but consider how costly kids can be, and is this a savings plan you can absolutely continue over 18yrs, or will you have a hard time paying daycare, arts and sports bills etc. in the future? One child can easily run $40,000 in daycare bills over 3 years…..

I’ve put 3 kids through university from my savings in my family RESP. The problem is many people have little idea how they work. It’s hard to believe but the government actually gives you money for these things when you save. Garth is right, stay away from the plans you see in malls and Dr offices. Set up a balanced, self directed plan and you won’t look back.
Best deal in town.

I started the Canadian Couch potato portfolio in December 2013.
I buy monthly and rebalance while doing so without any regard to the economy, the news or even Garth writes on this blog.
My rate overall rate of return to date is 13.33%.

I guess with a little more knowledge, I could be doing even better. But I just prefer spending my time on getting more income.

Realtors are already known as useless uneducated high school drop out shills who couldn’t qualify for a job at micky D’s since they lack the education. By trying to fight the laws Of economics realtors in canada will look just as foolish as their lying American counter parts. It’s bad enough realtors ruined the canadian economy one lie and sale at a time. To fight the housing crash with more lies goes to show what true POS a reator can be.

Moved 90% of my portfolio to USD over a year ago. I didn’t think Canada was sustainable at all.

Don’t regret it one bit.

I’ve gotten an extra 25% return in the last few months.

Trading has paid for my upcoming wedding.

I still don’t think there’s a lot in Canada, that’s worth throwing money at. Banks? Bigger and better in the US. Canadian manufacturing? Like who? Bombardier? Energy and housing in the crapper. The dollar will be at 60 cents US by the end of the year. Keep your money out of Canada and ride the gains of a deflating CAD.

I’m 1 class away from my Diploma in Financial Trading so take my advice with a grain of salt, but you need to do a risk self-assessment before you jump in. What’s good for you? What are you comfortable LOSING* 5%, 20%, more? *Losing is a natural part of investing.

Then you want to be diversified as possible. Mutual Funds are great just watch the MER costs, ETF’s are good, but avoid individual stocks till you get investing experience.

One of my friends was looking to rent a place on Vancouver Island. Lots of houses for sale, but not a lot to rent. Finally she asked the Realtor/Property manager she was working with “Are people going broke, selling their houses and now they need a place to rent?”

She said the R/PM stopped dead, looked like she just saw a ghost and slowly nodded her head.

At least I give this R/PM points for honesty, unlike some of the ones that show up here.

#10 Mike in the Okanagan on 02.03.15 at 6:54 pm
I agree with everything you said except with regards to mutual funds. Believe it or not some mutual funds do manage to consistently beat passive index funds long term net of management fees.

I think for some they are a viable alternative and cannot be dismissed as a group.
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Name a couple please?
According to John Bogle, it is very difficult to have some funds consistently outperforming the index

Been investing for just over a year now. Yes I am a millenial and yes I just Diversified using Ishares and boom! Would ya look at that! Now if I could just convince my family…and friends… And co workers… And neighbours…. And my realestate agent.. Mortgage broker… Etc etc…
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You know something bad is coming when Hipsters think they are financial gurus. . .

I remember reading 2-3 years ago that retail and strip malls were the next big wave of defaults. Who will fill these massive holes left by Rona and Target? No one. You think your strip mall looks like a ghetto now?

Cash is king. It’s not about making a ton on your investment, it’s about how much you can save. I am invested in nothing with money in the bank. Every morning I wake up and watch the dog and pony show that is the financial news never caring too much what happens. This allows me more time with my family, more time with my hobbies, and less life shortening stress.

All this irrational exuberance will have to end. My guess is it will crash in the marketplace before it ever crashes in real estate.

Cha Ching is that you???!!!! You are like a dog on a bone! Your posts are still a tad too rabid. Once again, these tactics won’t work here. All respectful opinions accepted here. Scroll past if you are having a problem.
——–

Is that a joke? Anyone not a RE doomer is called names, and they certainly not accepted here. For example, if smoking man mentions GTA January stats are out and sales up 6.1% and price up 4.9% people will say he’s a realtor.

Btw Mark has gone from calling a 1.5 CAD (ie USD at 66 cents) to now a 1.1 CAD in 10 years. And the reason he says this will happen? The US is going to raise interest rates. It is laughable. Garth himself has pointed out the stupidity of this.

The impact of lower oil prices on Alberta’s economy has some nervous homeowners in the province scrambling to unload their properties.

January housing data show sales dropping more than 30 per cent in each of Calgary and Edmonton, while new listings jumped more than 30 per cent.

“Low oil prices throughout January, combined with a shifting outlook in the energy sector, caused unease for consumers. As a result, monthly housing sales activity fell to levels not seen in five years,” the Calgary Real Estate Board (CREB) said in releasing its January numbers.

Sales in Calgary fell by almost 40 per cent in January compared to the same month last year, while new listings soared almost 40 per cent.

#45 Cloudy,
Congrats on the new baby. I’ve got a couple of young daughters myself and the RESPs are all set up. To answer your question your contributions do not get taxed twice. The contributions are returned tax free.

@#20 Jeff – And if you don’t understand 70% of the words in this article (and even if you do but need to, you know, have a life) get yourself a great fee-based advisor to help you out.

Maybe a good advice for some. There are probably honest advisors out there. However, if you have a small portfolio and you need all the income you can get, just keep on reading like I did, and you will eventually get it. It is not rocket science if you keep it simple. Garth has outlaid it all out today. If you are a DYI, you are already ahead 1% or more than if you pay an advisor. 1% is not nothing in this low-interest environement.

”So with all the doom and gloom about the RE market in Alberta, apparently even during the GFC the price barely dropped. Since we are way pass the GFC, how can the RE market be worse”

RE in Ab peaked in May 2007 and started dropping from that point although slowly. At the same time interest rates starting to drop as well as we were heading into a recession. The overbuilding that was going on in Ab at the time was incredible. Then, the GFC came along in the fall of 08 and the BOC went on their interest rate dropping spree and dropped the rates from around the 4.5% level to .25% by April of 09. That is what kept prices up but they did still fall back about 10 or so percent and stayed there and have only come back to their peak in recent times. The BOC does not have that 4.25% ability to drop as they did back then when the BOC is sitting at .75%. The gig is up.

RESP is your best bet. Odds are that jr won’t have to pay any taxes when in university, and the Feds give you money every year to the tune of 20%. Sweet. No TFSA for the kid until age 18. You can self-direct the plan. At all costs avoid the baby snatcher RESP sales guys. — Garth

This is great advice, of course. Where in the world could you get 20% of your investment?? RESP is a no brainer. Contribute enough each year to get the maximum gvt grant.

#103 olderthanaboomer,
Tangerine funds are likely no different than any other mutual fund. It’s all about the fees. Is there a load (fee for getting in or out)? What’s the management expense ration? That’s the amount of money they take from you regardless of how well the market performs. These “easy” funds usually charge a nice fat 2 to 3% MER and they’ll even try to hit you with a back end load (that way you don’t notice they’re ripping you off until you try and get your money at the end).

By comparison you can achieve the EXACT same balanced portfolio by setting up a self directed account and buying a handful of funds. If you pay attention and get the self directed version of the fund you can get the MER down to around 1 or 1.5%. Or better yet use ETFs and you can get the MER down below 1%. So what’s 2% of your money worth? If you don’t have much invested then maybe you don’t care. If you have a lot of money invested then it’s probably worth your time.

What if you’re confused about how to rebalance and if you’re actually doing the right thing? Find a financial advisor that you pay by the hour and is not making a commission based on which fund he puts you into. Again, depending on how much you have invested this is the cheaper / better option. Although most self directed accounts (at least the ones at the big banks) will have a model portfolio based on your risk tolerance that’s pretty easy to follow.

This is what Garth is telling people. I’ve been reading this site for awhile and he hasn’t tried to sell anything except maybe a couple of books.

To be fair, when the market is manipulated so that it always goes up, and always auto-recovers from any losses, it’s not hard to be a “guru.” Sure, there are a lot non-mainstream doomsayers who keep looking at the fundamentals, and warning a collapse is imminent, but every time the end is near, another rabbit is pulled out of the hat by the powers that be to keep the party going a bit longer.

I can’t help but notice the similarity to the housing market in Canada. Again we have a situation where any time it starts to drop, things are manipulated behind the scenes to make sure it doesn’t. Garth could very well be wrong about housing for years to come, because he never anticipates the next crazy and irrational thing they will do. Don’t think negative interest rates could ever happen in Canada? If it’s between that and saving housing, don’t be so sure.

I will say this: it’s pretty obvious to me that the Canadian economic collapse some are predicting is not going to come to pass. Don’t be surprised if the economy just keeps limping along in 2015, Harper wins another majority for his economic prowess, and we just keep the party going…

When my coworkers start saying it’s a good time to invest, I’ll consider going light on equities. They’re still talking about how another crash is going to happen, and are under the impression that stocks have done nothing for a decade.

I was just in a TD Bank a few minutes ago, and the young woman ahead of me was asking about “one of” her GICs that was maturing.

The vast majority of folks have been partying like rock stars on borrowed money buying stuff they can’t afford with money they don’t have and believing the party will go on for ever. The party keeps rocking so long as the participants have jobs and prices are going up, but when jobs go away and prices start falling the party is over. Followed soon after by a brutal hangover.

When distressed hung over party-goers are forced to liquidate their stocks, homes, cars, etc. at whatever price the market will bear and assets are marked down to reflect the new reality, the guy who EXITED this party early and is sitting in cash will be buying their stuff at .25 cents on the dollar.
________________________________________

Pipe dream? Much? Won’t happen to that extent.

What’s with all the vultures wishing ill on their fellow humans. Save your cash, if opportunity comes knocking great, if it doesn’t who cares. I’d rather see everyone continue to party rather than profit off their misery.

…”Notwithstanding his constituents’ boisterous cri de cœur, in the end Mayor Andrew Jakubeit insisted on disrobing. He nevertheless held out hope [a thong, actually] that some type of compromise solution might be implemented at future council meetings…”…

…”As is the case with all the current tenants, she’s been offered offered the right to move back in when the project is completed, but at a rate that’s almost twice as much as her current rent.

Residents are being offered a 20 per cent discount on rent. But because Concord Pacific will be able to apply rent increases as soon as the permit is approved, by the time tenants move in, that discount will only be about eight per cent.

“For most of us who live here, it simply is not feasible,” said Skeet.

She said many of the residents are on disability assistance or have chronic health issues.”…

[G&M] – Vancouver hotel to be turned into international student housing

…”An ESL recruiting company is buying up real estate in Vancouver to cater to international students it says are being failed by the region’s unaffordable rental market.

The CIBT Education Group announced this week that it had invested $37-million to buy and convert the 17-storey Viva Suites hotel into a 230-bed building, charging international students market rents in downtown Vancouver.”…

The Caspian Sea: Landsat satellite photograph of the Caspian Sea in 1972, left, 1987 (middle) and 2010, right. The Caspian is the largest body of inland water in the world. It is bordered by Russia, Azerbaijan, Iran, Turkmenistan and Kazakhstan. The centre image shows the loss of water and large salt bowl region due to the blocking of the Caspian in 1980. In 1992 the barrier was breached and allowed the Caspian’s water levels to rise, which is visible in the 2010 image.

A fascinating report published by Mumbai-based think tank Strategic Foresight Group (SFG), asserts that trans-boundary water cooperation directly correlates with regional stability and peace. The inverse also holds true: failure to collaborate when managing shared water resources raises the risk of war

“Btw Mark has gone from calling a 1.5 CAD (ie USD at 66 cents) to now a 1.1 CAD in 10 years. And the reason he says this will happen? The US is going to raise interest rates. It is laughable. Garth himself has pointed out the stupidity of this.”

No, I have not changed my long-term forecast for where I think the CAD/USD pair will eventually go, albeit briefly. Just like 0.63 CADUSD was an extremity, 1.5 CADUSD will also be an extremity. The latter caused by a set of conditions roughly the opposite of the former. I’ve laid out the argument for debt deflation causing the CAD$ to rise, and am willing to explain why Canadians repaying CAD$-denominated debt is very bullish for the CAD$. But in the short term, things can move in very much the opposite direction, on the whim of speculators. Its really unfortunate that certain trolls out there aren’t interested in having a respectful debate, as certainly there can be other points of view.

#151 BCD on 02.04.15 at 12:27 pm
#55 Smoking Man on 02.03.15 at 8:51 pm
Jesus Christ, my kid loses 43 k in one day..
Forex dogs, only for dogs with bigger ones than those daggling from newfee pick up trucks.
Told him to Sell USACAD on Friday.. He did, got scared, took a hit.. He would have been up huge..
Idiot..
Will post on my blog later, took him two days to tell me.
I’m trying to train him, why does he fear judgement.
Kids..
___________________________________________
Maybe send him back to school to get his grade 12.

_____________________________________________

Ten bucks says SM, Mrs SM and his kids need to go back for Grade 12. Hes got a bit of hillbilly in him. If Mrs SM didn’t get after him for his misuse of the queens English then she’s pretty much a goner too!

…”Authorities say a former Newport Beach dentist is suspected of being the “rolled-sleeves bandit” responsible for stealing more than $21,000 from seven banks on the Southern California coast.

Police arrested Damian Newhart last week at a dental office in Inglewood after someone recognized him from security video the FBI distributed to local media, according to an affidavit filed in federal court.”…

#113 Smoking Man on 02.03.15 at 11:34 pm
The bet, can I make it to the tax farm by 6am, during 6 inches of snow… From Buffalo.
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Holy crap smoking man, what in gods name are you doing in Buffalo yesterday? I was talking to a boating buddy who lives in Tonawanda and he said they where getting wacked with snow again! I can’t think of any reason why someone would go to Buffalo at this time of year.

A rise in new listings combined with a plunge in sales in January suggest that house prices in Calgary will fall by close to 15%, according to a leading Canadian economist.

“Lower mortgage rates won’t prevent home sales and prices falling sharply in regions directly hit by the slump in oil prices,” said David Madani, with Capital Economics, in a research note published on Wednesday. “While they might support housing activity in other key markets, we fear that this will only fuel greater overvaluation, higher household debt and more overbuilding.

“Accordingly, we remain deeply concerned over the longer-term prospects for the housing market.”

#375 pinstripe on 02.01.15 at 2:45 pm
the more I read about the mileniums in our society, the more I am accepting that they are too stupid to figure it out how they are screwing themselves in the long term.

==========

How do you mean? They are working for the entitlements you say you’re entitled to!

So far, if they listened to you (their elder) you’d say hey get to work and fund these programs I’m entitled to.

Can you blame them for buying junk? Their future is already indebted by debt your generation created!

Lots of people talk about investing but very few actually do. The majority of the ones who do are inexperienced and make mistakes, like rushing for the door when asset classes are falling. They end up getting creamed and join the rest and enjoy the returns from either high interest savings accounts or gics. After a few years they return to the market. Wash, rinse and repeat. That’s why they’re losers!

#185 Holy Crap Wheres The Tylenol on 02.04.15 at 3:14 pm
#113 Smoking Man on 02.03.15 at 11:34 pm
The bet, can I make it to the tax farm by 6am, during 6 inches of snow… From Buffalo.
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Holy crap smoking man, what in gods name are you doing in Buffalo yesterday? I was talking to a boating buddy who lives in Tonawanda and he said they where getting wacked with snow again! I can’t think of any reason why someone would go to Buffalo at this time of year.
…….

Senica Man, gambling, had the itch and it paid off. I Destroyed the crap table.

#126 Capt. Obvious on 02.04.15 at 1:13 am
William G. Bernstein (writer of several excellent personal finance books) wrote a pamphlet for Millennials on how to avoid being financially crushed. It’s called “If You Can”.

It’s targeted at a US audience, but anyone could benefit. It’s available for free in several formats, just follow the links.

That was a good read, thank you for sharing the link.

Brand newbies, read this booklet (and do the reading homework). It’s exciting to get started, but you are much better off doing so from a base of knowledge. Save yourself from losses due to simple and avoidable mistakes, and make investment choices suited specifically to you. You’ll also feel a lot better understanding “why?” and not just “how?”

when the “powers to be” start putting a positive spin on the little things that have been achieved to date, it is an indicator NOT to drink the kool aid. this is a sure sign that everything is going to hell in a hurry.

the milleniums are too stupid to figure this out.

in my younger years I was told that my entitlements were a sure thing, whereas today the milleniums are told that they will have nothing when they reach the 67 year mark.

as it stands today, those who save will be in the same pot as me today. Punished for Saving.

******************************************
not so interesting read
Rob Carrick vs John Bogle, can the 2 names be put together?
Interesting read is: The Little Book of Common Sense Investing by John Bogle.
Enjoy reading

“I will say this: it’s pretty obvious to me that the Canadian economic collapse some are predicting is not going to come to pass. Don’t be surprised if the economy just keeps limping along in 2015, Harper wins another majority for his economic prowess, and we just keep the party going…”

They will sure try to keep the party* going until the elections, but I wouldn’t be planning on anything after that. Also this majority is doubtful

*Party in the GTA/Vancouver I mean, it is pretty much done everywhere else in Canada (especially in Calgary) there is absolutely nothing more that can be done

When you’re dealing with smaller amounts then you absolutely have to include the trade commission of an ETF into your MER. I would suggest you could build a balanced portfolio with as few as 4 or 5 ETFs (1 or 2 bond ETFs, 1 CAD, 1 US, 1 international). So to enter your entire $20,000 into this portfolio it would cost you $50. That’a an MER of 0.25%. It will cost you the same to each year when you rebalance. If you’re buying the run of the mill large ETFs the MER on those will maybe be another 0.25% to 0.5%. So your MER is 0.5% to 0.75%. That’s still beating the pants off the Orange Guy, but you can only rebalance once a year so forget monthly contributions.

The other option would be to do self directed mutual funds. They are often carbon copies of the non-self directed version but you save MER by doing the mouse clicks instead of the Orange guy doing them. These cost in the range of 0.75% to 1.25%, so still more than the ETFs, but now you can add monthly contributions if you like or rebalance more often, hold a wider variety of funds, etc.

I’m guessing even with the self directed mutual funds you’re beating the orange guy by a solid 1% if not more. That’s $200 a year. So if that’s worth your time then do it. If not then wait until you have more to worry about it. And it doesn’t matter that your investment went up by 10% with the orange guy, it would have gone up 11% with this method.

Amazing how people jump to conclusions. Why should I pay any respect to an education system that’s gone rouge. I refuse to put together, words that contain perfect spelling, and grammar.
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Congrats Smoking Man you just put a perfect sentence together without any spelling mistakes. Did you turn on grammar and spell check?
Sorry dude you wouldn’t have made a pilot in the air force or for that matter in the civil world without perfect spelling and diction. Communication in aviation is paramount!

BHP ,the Australian mining giant is laying off thousands off workers and cancelling nearly a billion dollars of capital projects as the demand from China of iron ore
dwindles.
Interesting times ahead for sure.

Last! Crude diving 8.37% today. Down to $48.61… Dry Baltic Index (BDI) approaching all time low…@ 569 and falling. This measure of super tanker tonnage of bulk raw materials means @ the least China’s going into a funk along with Calgary cowboy housing flames. Might mean that everything dives when the US buck pumps or something like that…

Amazing how people jump to conclusions. Why should I pay any respect to an education system that’s gone rouge. I refuse to put together, words that contain perfect spelling, and grammar.
___________________________________________

Congrats Smoking Man you just put a perfect sentence together without any spelling mistakes. Did you turn on grammar and spell check?
Sorry dude you wouldn’t have made a pilot in the air force or for that matter in the civil world without perfect spelling and diction. Communication in aviation is paramount!.
………..

That’s not would keep me out.. This whole saluting thing.. I have a problem with it…

#203 Mike S on 02.04.15 at 4:26 pm
“CAD is going way down on Fri, jobs report is coming out. Street says 7k + jobs added, I say nonsense they are never right. I say -50k jobs, blow out loss, jaws drop, another “surprise”.”

With recent StatsCanada track record and margin of error (+/- 60K jobs) seeing +7K won’t surprise me at all ……………………………………………………………………..

I don’t even come up on unemployment stats because I didn’t have 600 hours to collect UI.

I’ve been unemployed for 3 months now and pretty much gave up looking… I get these agencies sending my application and resume in for job opportunities and it’s all raw raw and then nothing ever happens, I don’t hear from them again.

“BHP ,the Australian mining giant is laying off thousands off workers and cancelling nearly a billion dollars of capital projects as the demand from China of iron ore
“

The BHP cuts could hit Canada. That project they’re developing in Saskatchewan, for lack of better words, is awfully uneconomic. And was mostly pursued on the basis of the ego of the former CEO, not anything that resembled sound decision making.

The usual 3 months closing time is going to look so long. Put yourself in a buyer’s shoes in Calgary seeing nothing sells and prices going down already. Those 3 months will create lots of buyer’s remorse. And many buyers will find ways to drop out of the deal, suit or not.

– a rising USD is the worst thing that can happen to the world.
– US interest rates have gone down since 1981 and are about to explode higher. No, NOT as a result of inflation. Rising interest rates are the most DEFLATIONARY force in the world.
– Oil is on its way to $10 but then we’re also talking about a USDX of 120, 140 or even 160 at the same time.

I do hope one Mr. Turner does stop drinking the “Raymond James” kool-aid a.k.a. “The US economy is on the mend”. (It isn’t).

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The views expressed are those of the author, Garth Turner, a Raymond James Financial Advisor, and not necessarily those of Raymond James Ltd. It is provided as a general source of information only and should not be considered to be personal investment advice or a solicitation to buy or sell securities. Investors considering any investment should consult with their Investment Advisor to ensure that it is suitable for the investor's circumstances and risk tolerance before making any investment decision. The information contained in this blog was obtained from sources believed to be reliable, however, we cannot represent that it is accurate or complete. Raymond James Ltd. is a member of the Canadian Investor Protection Fund.